The E-way to go for sustainable mobility solution

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India’s growth story to reach its target of the (ambitious) 5 trillion dollar economy requires not only robust economic machinery but also sustainable solutions that can withstand the test of time.

Take, for example, mobility. India has a road network of 5.5 million km consisting of highways, urban & rural roads. The length of the highways is growing exponentially year-on-year. In the FY 2019-20 NHAI constructed 3,979 km of highways and in FY 2020-21 12,205.25 Km of state-of-the-art highway route was added to the nation’s road network.

But interestingly almost 98% of the total road network, consists of urban & rural roads that carry approximately 60% of the total traffic. I guess this saves us the effort of a nation-wide hunt to track down the vehicles that are exhausting cocktails of pollutants in our environment.

Considering India’s international commitment to play a key role in combating climate change and promoting environment-first policy, it is high time that the government mandates nation-wide sustainable mobility solution. Remember, our global investors are watching and the volatility of oil prices is not making it a pretty sight.

The saving grace in all this is the government’s proactive approach in speeding up the transition to e-mobility. India aims to achieve 100% electric mobility by 2030 and to implement a mobility model that is Shared, Connected & Electric. Relying on its abundance of renewable energy & skilled manpower in both technology & manufacturing, India is set to benefit on multiple fronts.

Though India’s EV narrative is just at its prologue stage, yet the potential of it turning out to be a best-seller is quite real & achievable. India offers the world’s largest untapped market, especially in the two-wheeler segment. As per SIAM’s report (Society of Indian Automobile Manufacturers) 2-wheeler manufacturers have 81% of the total domestic market share.

The overall vehicle sales trends YoY also testify to the huge popularity & growth potential of 2-wheelers in India. In 2019-20, out of the total 21,546,390 vehicles sold, 17,417,616 were Two-wheelers.

Auto-mobile Domestic Sales Trends (Source: SIAM)

Taking cognisance of this, the government allowed 100% foreign direct investment in this sector through the automatic route. This was too good an opportunity for the OEMs to miss and they responded in affirmative to the call.

Ather Energy fast-tracked its manufacturing facility in Hosur and it became operational in Feb 2021. The claimed annual production capacity of the factory is 0.11 million two-wheelers.

Ola Electric, also announced its scale-up strategy to achieve the target of producing 10 million vehicles annually, by 2022. To facilitate the target Ola Electric will set up the world’s largest electric scooter plant in Hosur within a few weeks.

Electric vehicles have only a 1 % market share of the total vehicle sales in India. However, the sales of  e 2-wheelers have grown YoY. E2Ws (less than 25km/hr) form 90% of the total EV sales in India. Ease of maintenance, low running cost, and simple mechanism have enabled far greater adoption of E2Ws than their 4-wheeled cousins. At present, there are approximately 5 lakh E2Ws on Indian roads compared to only a few thousand E4Ws. According to SMEV’s report (Society of Manufacturers of Electric Vehicles), there is steady growth in E2W sales over the years but E4W sales remain low and erratic.

Since its inception in 2017, Detel is in the Indian market with pocket-friendly electronic gadgets and tools. However, driven by the government’s fillip to the EV manufacturing sector and lucrative EV policies, the company like many of its contemporary OEMs, diversified its business to smart EVs in January 2020.

“Detel is an Indian brand that aims to become the most dependable EV 2-wheeler manufacturer in the country. We are offering sustainable mobility solutions for the daily commuting needs of an average user”. Dr. Yogesh Bhatia – Founder Detel India, said.

Detel launched its latest offering in the electric 2 -wheeler segment – The Detel Easy Plus. Armed with an advanced 20 Ah lithium battery and the claimed top speed of 25Km/h, the 2nd e-bike in the Detel Easy segment is priced at Rs 39,999. The company also started accepting pre-booking with the payment of only Rs 1999. Detel claims that the “Made In India” futuristic e-bike provides a mileage of 60km/charging and is set to revolutionise EV usage in India. As per the company’s leadership, Detel wants to bring down the high initial cost that had deterred EV buyers earlier and bring affordable environment-friendly mobility within the reach of every Indian.

“To drive greater adoption, it is important to generate awareness & make people experience EVs. This can only be achieved by making EVs affordable for the public. If EVs are affordable then more users will be keen to switch to it. Global trends show that 80% of EV users prefer E2Ws and in India, where the majority of the vehicle market is driven by 2-wheelers, affordable E2Ws (low speed) will enable greater adoption” Bhatia added.

Electric 2 wheelers are largely powered by lead batteries keeping the vehicle cost low, however, battery failures and the low life of batteries have become major limiting factors for sales besides government subsidies. Though the government is yet to bring low speed E2W under subsidized category, but it has announced various policies to promote development of superior quality of batteries.

In a bid to set the precedence of a sustainable mobility model in the country, the Union Minister for Road Transport & Highways, Nitin Gadkari assured all possible support to EV manufacturers in developing indigenous battery technology. This move can significantly bring down the cost of EVs as OEMs would save import duty on batteries and components manufactured abroad.

The government also formed National Mission on Transformative Mobility and Battery Storage. Chaired by Niti Aayog’s CEO, the mission will enable the establishment of large-scale, integrated batteries and cell manufacturing Giga plants. It will also support indigenous production across the entire electric vehicle value chain through the Phased Manufacturing Program till 2024.

The ministry of power also brought EV charging under the services category. Hence, the EV charging stations will not require an operating licence.

As the conventional fuel prices are hovering around the Rs 100/ltr mark, coupled with the government’s backing for eco-friendly means of transport, the desire for EV adoption has seen a slow but steady surge in India.

In a recent survey conducted by CarDekho, a leading auto-tech firm, in association with a leading advertising & marketing company, 66% of potential vehicle customers voted in favour of buying electric vehicles. The survey also highlighted environmental awareness, driving experience, and low maintenance cost as determining factors for customers’ shift to EVs.

Riding on the growing popularity of EVs, individual users, as well as commercial operators, are integrating EVs in their scheme of things.

One of India’s most popular two-wheeler taxi service providers – Rapido, has initiated a three-month pilot run for its electric two-wheeler taxi service in Delhi-NCR, starting March 2021. In its bid to increase awareness about EVs and to reduce carbon footprint, the company has partnered with Zypp electronic for a fleet of 100 E-bikes.

On the partnership with Rapido, Akash Gupta, Co-Founder, Zypp Electric, said “The partnership with Rapido is part of highly focused EV utilization project where we wish to ensure that every segment is able to switch to EVs comfortably. With our robust battery-swapping network which will be tested with bike taxi services with Rapido, we’re here to bolster the EV proposition together with this partnership and would love to scale this nationally making people get pollution-free taxi rides too.”

If the government continues to develop a conducive environment and supportive policies for the sector, we can expect large-scale disruption backed by innovations in this space. EVs can prove to be a sustainable solution that can reduce our dependence on non-renewable resources, keep our carbon footprint in check and make mobility affordable.

As almost all the stakeholders in the EV ecosystem are coming together to develop a holistic growth model, the sector is well on course to take the quantum leap towards realising the vision of 100% electric mobility by 2030.